Important point
The judgment of the High Court upholding the levy of additional toll tax under notification No. SRO No. 338 dt. 20.8.82 is not sustainable as it is clearly beyond the purview of Section 3 of Tolls Tax Act, 1995 (Sambat 1938 AD).

Headnote:Constitution of India—Articles 19(1)(g) and 14, 286(1)—Levy of additional Toll Tax under notification SRO 348 dt. 20.8.82 on dry fruits like Almonds, Walnuts and Walnuts Kernels—Legality and validity—Levy of Toll Tax Act, 1995 (Samvat 1938 A.D.)— Section 3 meaning of expression ‘‘toll’’—Levy of tolls upon public roads and bridges in J and K State under the 1995 Act—Whether levy of additional Toll Tax under the notification on National Highways permitted under Section 3 of the Act? (No)—Result—Appeal allowed —Case law referred—Prospective operation of judgment directed.
       Held : It is clear from the above that though tolls are of different types and may be levied in different situations, it ordinarily means the amount which the government, or a local authority or a person duly authorised by the government may collect for passage of carriages and vehicles over a road or bridge. This meaning is by no means exhaustive. Where provision for levy and collection of tolls is made under the legislative enactment or a subordinate legislation then the levy is to be governed strictly according to the provisions of the statute or rules or any other instrument, as the case may be. (Para 21)
       Held further : The scheme of the Statute does not envisage levy of toll on goods or on any transaction of sale thereof. It is clearly a levy upon user of public roads and bridges in the State. The scheme fits in with the concept of tolls, be it toll traverse or toll thorough, to be levied in lieu of the advantage or privilege provided by the State Government for user of roads and bridges lying within the State. For the purpose of the levy the agency which has constructed the roads or bridges in question or the source of finance for implementation of the project are not relevant. On a prima facie reading of the Notification No.348 in the context of the provision in Section 3(1), it is manifest that the Notification is not in conformity with the power vested in the State Government under the Section. On a plain reading of the Notification it is clear that the intention is to levy toll on dry fruits including almonds, walnuts and walnut kernels exported out of the State through certain exit points by road or railways. The power to impose such a levy does not flow from the power vested in Section 3 of the Act in purported exercise of which the Notification has been issued. (Para 24)
       Held finally : From the discussions in the foregoing paragraphs, the position that emerges is that the Notification No.SRO 348 in which the additional toll tax was levied was clearly beyond the purview of Section 3 of the Act. Further, the finding of the High Court that in the context of facts and circumstances of the case, processing of the dry fruits like almonds, walnuts and walnut kernels did not come within the expression manufacture cannot be said to be erroneous. The judgment of the High Court upholding the levy of additional toll tax in the case is also unsustainable. Accordingly, the appeals are allowed. The judgment of the High Court under challenge is set aside. It is made clear that this judgment will have only prospective operation and any amount collected as toll/additional toll tax under the impugned notification need not be refunded. Parties to bear their respective costs. (Paras 29 and 30)

Judgment

D.P. Mohapatra, J.—Leave is granted in all the Special Leave Petitions.

2. The controversy raised in these cases relates only to the legality and validity of the levy of additional toll tax under Notification SRO 348 dated 20.8.82 on dry fruits like almonds, walnuts and walnut kernels. In view of the common questions involved in the cases they were heard together with consent of learned counsel for the parties, and they are being disposed of by this judgment.

3, For the sake of convenience we will refer to relevant facts with reference to writ petition no. 660 of 1982 filed by M/s. Mehta Foods Pvt. Ltd. against the State of Jammu and Kashmir represented by the Chief Secretary and the Secretary in Ministry of Finance of the Government of Jammu and Kashmir which is the subject matter of Civil Appeal arising out of SLP (C) No. 16852 of 1999. In the petition filed under Article 226 of the Constitution of India read with Section 103 of the Constitution of Jammu and Kashmir before the High Court of Jammu and Kashmir the writ petitioner sought the following reliefs :

"It is, therefore, prayed that the Notification SRO 348 dated 20.08.1982 and Notification SRO 349 dated 20.08.1982 may be quashed by a writ of certiorari as the impugned Notification is ultra vires the statute and that it also violates the fundamental right of the petitioner under Article 19(1)(g) and 14 of the Constitution of India and is otherwise ultra vires of Article 286(i) of Constitution of India.

The Hon ble Court may grant such other relief as the circumstances of the case may warrant."

The respondents contested the case. That case and the other connected matters were decided by a Full Bench of the High Court by the judgment rendered on 23rd August, 1999.

3. In the writ petition the petition questioned the validity and legality of the levy of additional toll tax @ Rs. 0.60 paise per kilogram on dry fruits including almonds, walnuts and walnut kernels, to be exported out of the State of Jammu & Kashmir through the barriers located at Lakhanpur, Jammu Railway Station, Manwal and other toll posts, as may be notified by the State Government from time to time. Alternatively the writ petitioner contended that even if the levy of toll tax is held to be valid, then the additional toll tax is not payable by him since the State Government by a notification had granted exemption from payment of toll tax to those who were engaged in the process of manufacture of dry fruits. The petitioner submitted that it was engaged in the business of sale and export of dry fruits including almonds, walnuts and walnut kernel not only to places located outside the State of Jammu & Kashmir but also to foreign countries. The dry fruits referred to above were collected from the growers and before exporting them, they were subjected to various processes. After purchasing walnuts and bitter apricots in shell from different parts of the State, the raw materials were transported to the petitioner s factories. In the factories the walnut and bitter apricot were subjected to various tests and processes which were both manual as well as mechanical. This was done with a view to ensure best quality materials are supplied to foreign markets.

5. Setting out the details of the processes undertaken by it the petitioner stated that the walnuts and bitter apricots in shell were first graded by a grading machine with a view to ensure size segregation; after completing the process of grading, the dry fruits in shell were sorted out manually; this was done so that the split walnuts, damaged nuts and spoiled nuts as also the oily nuts were separated. After completing the process of sorting, the walnuts were subjected to bleaching. They were treated with a chemical solution. This is meant to give them a luster and attractive appearance. It was the contention of the petitioner that it is this process of bleaching which completely transforms the original look of the nuts and renders the outer sh

Click Here to Read the rest of this document

2002 Supreme(SC) 690

Important pointThe judgment of the High Court upholding the levy of additional toll tax under notification No. SRO No. 338 dt. 20.8.82 is not sustainable as it is clearly beyond the purview of Section 3 of Tolls Tax Act, 1995 (Sambat 1938 AD).

Cases Referred (5)

Important point
The judgment of the High Court upholding the levy of additional toll tax under notification No. SRO No. 338 dt. 20.8.82 is not sustainable as it is clearly beyond the purview of Section 3 of Tolls Tax Act, 1995 (Sambat 1938 AD).